LONDON — The pieces are in place for Unilever to spin off part of its tea business. Now company management must decide what form the spinoff will take — initial public offering (IPO), partnership or sale.
“The operational separation of our tea business is now substantially complete,” said Alan W. Jope, chief executive officer, during a July 22 call with analysts to discuss first-half financial results. “We've created an attractive stand-alone business with dedicated leadership.”
In July 2020, Unilever said it was divesting a part of its tea business, including the Tazo, Pukka Herbs, T2 and other tea brands. The company plans to continue operating its tea businesses in India and Indonesia and will remain in its joint venture with PepsiCo, Inc., Purchase, NY.
The tea businesses to be spun off employs approximately 3,500 around the world and will have approximately 90 facilities. The company did not provide a sales figure for the new business.
“We've established the sales organizations in our largest markets with systems implementation on track to (be) completed over the next two months,” Mr. Jope said. “We will start to engage externally very shortly to execute an outcome, and this could be through an IPO, through a sale or through a partnership.”
Mr. Jope did not provide a timeline for when the business may be spun off, only saying it will depend on which of the choices maximizes value creation for Unilever’s shareholders.